The city council decision this week to yank a $26 million-plus construction contract from one company and award it to another won’t delay a late 2010 completion date for the Wonder World Drive extension, officials say.

But with threats of lawsuits flying freely over the lucrative job, that’s about all they’re saying.

On Tuesday, the city council voted without discussion to declare low-bidder Rodman LLC non-responsive to an Aug. 19 contingent award after the Round Rock-based company failed to deliver proof of insurance and performance bonds. Instead, the contract will go to Leander-based J.C. Evans Construction, which returned the second lowest offer of $26,385,648 compared to Rodman’s $26,218,770 bid.

Council members re-awarded the contract after consulting for a half-hour behind closed doors with the city attorney. The executive session came after representatives of a trade group and San Marcos-based Hunter Industries argued that the contract should be rebid under Texas Department of Transportation guidelines.

“The validation for awarding the contract to the second-lowest bidder is that Rodman was non-responsive. What really happened is that they failed to execute the contract and it must be handled accordingly,” said Lee Taylor, the south Texas area manager for the Associated General Contractors of Texas’ Highway, Heavy, Utilities & Industrial Branch.

As evidence, Taylor tendered an Aug. 1 e-mail from Kellogg, Brown and Root in which project manager Michael Sexton wrote, “The recommended contractor has met all the requirements in the Bid Proposal package.”

City Manager Rick Menchaca did not return a phone call for comment.

With material and fuel costs falling, a Hunter Industries representative told the council, “If we have the opportunity to rebid the project, I guarantee you you’ll see a cost savings over what you’re looking at tonight.” Hunter originally bid $26,218,770, the third-lowest of nine bids.

The contract dispute is the latest snag for a project that has been delayed repeatedly since voters first approved $1.5 million to start the project in 1998. The four-lane divided parkway will connect Ranch Road 12 to Interstate 35 by extending Wonder World Drive beyond its current terminus at Hunter Road.

The city has spent $5.7 million for engineering, $4.6 million for land acquisition, $610,819 for environmental assessments, $463,969 for archaeological studies and $4.6 million for mitigation.